FTC settles lawsuit over domain name renewal scam.
The U.S. Federal Trade Commission has settled with a group in Canada that it says posed as domain name registrars and duped thousands of people and companies into paying bogus bills by leading them to believe they would lose their Web site addresses unless they paid. We in the domain name industry often refer to this as the “domain name renewal scam”.
The FTC charged Toronto-based Internet Listing Service back in 2008 with sending fake invoices that appeared to be coming from a domain owner’s registrar. Consumers were led to believe that they needed to pay the invoices in order to continue using their domain names. The invoices also included a search engine optimization service that the FTC says was misleading.
A federal district judge halted the practice after the charges were filed and froze the defendant’s assets. The settlement and default judgment order will end the litigation. The judgment claims $4,261,876 in consumer damages, but the defendants will only pay $10,000 because they say they are unable to pay the full amount.
Tim says
Why are these damn crooks not thrown in prison like a street thug would be?
There still sure is a double standard for blue collar and white collar thieves.
It’s disgusting.
Me says
Def a scummy technique, but illegal? Once again I have to see the letters (I got a few myself a while back) but if I tell you that domainnamewire.com is about to expire and I can renew it for $200 why should that be illegal?
The Original Domainer says
“The judgment claims $4,261,876 in consumer damages, but the defendants will only pay $10,000 because they say they are unable to pay the full amount.”
Where did the $4,261,876 go? This makes the U.S. Federal Trade Commission look like idiots.
barefoot says
The responsibility here lies with the registrants who didn’t bother checking to see who their actual registrar was.
Henry says
Put Simply, based on some of the comments here, now you have an idea who not do any business with.
Henry.
mansour says
Andrew Allemann I am surprise that you did not identify those people every one know who they are, and if you do not say I will not say.
Andrew Allemann says
@ mansour I don’t know anything beyond the names on the web site
Me says
“Put Simply, based on some of the comments here, now you have an idea who not do any business with.”
Being a jerk and charging way too much money is not a criminal offense (Fabulous charges as low as $7.99 a name, others $35.) I may not like your ethics but does not mean you deserve jail time.
But reading the complaint they actually just took the money and did nothing. I thought that they renewed the names but for $100+ each.
Another Reader says
I just read the settlement announcement on the FTC’s website. Wow. I cannot believe they get off so easy. I’m in the wrong business. I’ll bet they paid 10k in legal fees plus the 10k settlement (admitting no wrongdoing by the way), so ~20k total. Who knows how much profit they made, but I feel sure 20k is a drop in the bucket. I’ve received these letters, don’t know if any from them, but it’s a scam, no matter how some of the readers here want to rationalize it.
Josh says
I received some over the years, obviously not fooled but who would fill out all that paper work any way? Mine usually came witha Maple leaf logo, anyone else?
Bo says
They come by snail mail. Who renews domains by snail mail? An unknown company sends a letter to renew your domain name for a hefty fee and people are stupid enough to send them money. I got lots of those through the years and they ended up in the garbage.
Andrew Allemann says
@ bo – if you’re in accounts payable and deal with dozens of these a day, you’ll probably overlook it.
Christian SEO says
I get this type of mail and wonder how many people get scammed. It’s a shame because there are reputable SEO companies that do great jobs! Glad they good one of the bad guys – I’m sure there are a lot more out there that need to be caught and put in prison.